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| Definition: |
A set of pricing methods where people are asked how much they would agree to pay for avoiding a degradation of the environment or, alternatively, how much they would ask as a compensation for the degradation.
Alternatively, people can be asked to make trade-offs among different alternatives, from which their willingness to pay can be estimated. These methods include contingent valuation which is a direct method and conjoint analysis approaches (contingent ranking, rating, etc.) which are indirect. Both generate welfare estimates of environmental benefits/damages based on stated willingness to pay.
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| Context: |
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The methods are referred to as “stated preference” methods, because they ask people to directly state their values, rather than inferring values from actual choices, as the “revealed preference” methods do.
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| Source
Publication: |
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United Nations, European Commission, International Monetary Fund, Organisation for Economic Co-operation and Development, World Bank, 2005, Handbook of National Accounting: Integrated Environmental and Economic Accounting 2003, Studies in Methods, Series F, No.61, Rev.1, Glossary, United Nations, New York, para. 9.90.
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| Statistical
Theme: Environmental statistics |
| Created
on Wednesday, July 06, 2005 |
| Last
updated on Thursday, December 01, 2005 |
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